Price Payment Delivery Notes

Agreeing the price

(UK provisions)

S8 and s9

• Most circumstances, the parties will agree the price. May be done in a number of ways:

1. Use of price list or quotation;

2. Agreed during negotiation;

3. Determined by a consistent course of dealing between parties;

4. Price fixed by valuation of a third party (s9- void if this doesn’t happen).

Price lists & quotations:

• Where this is the case, important to specify the length of time for which any quoted price or price list will remain valid.

• Specify what is included in the price.

Price escalation clauses:

• If there is a likelihood that costs of raw materials or labour will increase between signing contract and delivery, can include a price escalation clause.

• In absence of such a clause, S will not be able to change the price.

• Will be subject to reasonableness under s3 UCTA.

VAT:

• Price taken to include VAT unless otherwise specified (VAT Act 1994, s19 (2)).

• If exclusive, must be expressly stated.

Duty to pay the price

(UK provisions)

Ss27-29

• Under s27 SGA, it is B’s duty to pay the price.

• Where contract provides for cash on delivery, B cannot claim possession unless it is able to pay in accordance with the contractual terms agreed.

• Only payment in full will discharge B’s liability (unless agreed otherwise).

Time for payment:

• S28 SGA states time for payment is when goods are delivered (unless agreed otherwise).

• However, payment may be linked to the issue of an invoice. The Ps may wish to agree that:

1. Payment be made in advance;

2. B is given a credit period (say 30 days from delivery of invoice) in which to pay.

• S10 (1) unless expressly stated, time of payment is not of the essence.

• Interpreted to mean that failure to pay is not a breach of condition entitling the S to treat contract as repudiated and to sell goods elsewhere. Limits S’s right to price and damages, if any, for late payment.

Method of payment:

• S28 SGA seller is entitled be paid in cash (unless contrary agreement):

1. If S accepts cheque or other negotiable instrument, treated as conditional payment. If cheque is not honoured, S may sue for the price either as breach of SOG contract or on the cheque being a contract in itself;

2. Payment by credit card will usually be treated as absolute payment.

• Art 58 Vienna convention unless otherwise agreed, B must pay when the goods are made available to him.

• UCC similar provision in Art 2-310;

• UNDROIT Art 6.1.4- all obligations must take place simultaneously unless agreed otherwise.

Late payment:

• In absence of contrary agreement, damages payable for late payment by English courts under various statutes (see pg 47).

• Contract should provide for late payment in order to avoid reliance on these.

• EU governed by Directive 2011/7/EU on Combating Late Payment in Commercial Transactions (see pg 47).

UK provisions

• S27 SGA duty of S to deliver, in the legal sense, the goods.

• No general duty to transport goods to the buyer.

• Goods must comply with the contract (implied conditions under s12, 13, 14 & 15.

• Failure B can reject goods.

International provisions

• Mirror the UK provisions.

• Vienna convention Art 31

• UNIDROIT Art 6.16

• UCC Art 2-308;

• PECL Art 7:101.